Citigroup's Mexican bank fires 11 in oil scandal

MEXICO CITY (AP) — Citigroup's Mexican bank subsidiary said Wednesday it has fired 11 employees for not following proper procedures in dealing with a Mexican oil services company that allegedly defrauded Citigroup of up to $400 million.

Grupo Financiero Banamex said in a statement that the 11 employees of various ranks "did not follow the supervisory standards expected as part of their responsibilities."

It said more employees might face sanctions, as a result of an internal company investigation.

"We are reviewing our risk controls and procedures and we continue to strengthen all those areas that did not comply with Citi's global standards and best practices," Banamex General Director Javier Arrigunaga said in the statement.

In February, Banamex announced that the oil services company Oceanografia had used falsified invoices as collateral to obtain $585 million in loans. After an investigation, Citigroup could verify only $185 million of invoices.

The owner of the Oceanografia has been placed under a form of house arrest by Mexican authorities while investigations continue.